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Headquarters Office

Related Content: Administrative Office; Offshore Vehicles
 

Headquarters offices are offices situated abroad to exercise certain management, co-ordination, and control functions for the sole or principal benefit of an enterprise or group. Headquarters offices may benefit from a favourable tax regime even in an otherwise high tax jurisdiction. The competition between these countries is resulting in the de facto introduction of more and more favourable tax regimes through what may amount to a partial system of unpublished revenue rulings.

 
 
 
 
 
 

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Relief Provisions in Tax Treaties

Unilateral and treaty provisions normally provide for one of the following types of relief, i.e.: a tax exemption; a tax credit; a tax reduction; or a reduction in the rate of tax.
 

Embedded Software

The embedded software issue is whether software that is required in order for a hardware system to be operational should be treated as a unit or separated for taxation purposes (including updates of the software). Among the most important issues addressed by the Technical Advisory Group (TAG) on Treaty Characterisation concerns the treatment of so-called embedded software -- for example, computer equipment with software “embedded” in the hardware. These issues may be material for some international tax plans involving cyber technology.
 

Exchanges of Information

The principal formal exchange of information mechanism is the tax treaty. Separately from the obligations under tax treaties, it may be assumed that informal exchanges of information between the administrations are on the increase.
 
 
 
 
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